SETTLEMENT
AGREEMENT AND FULL RELEASE


 


THIS
SETTLEMENT AGREEMENT AND FULL RELEASE (“Agreement”) is entered into as of this 21st day of December, 2016, is entered
into by and among between Cachet Financial Solutions, Inc. (“Cachet”) and Trooien Capital (“Trooien”).
(Both parties may be referred to collectively hereinafter as “Parties” and individually as “Party”)


 


RECITALS:


 


A.       The
Parties are parties to a lawsuit against captioned Cachet Financial Solutions v. Trooien Capital in Hennepin County, Minneapolis,
MN 55402 (the “Lawsuit”).


 


B.       On
December 12, 2016, the Parties mediated their dispute with mediator the Honorable Jonathan G. Lebedoff.


 


C.
       The Parties have determined independently that it was desirable and beneficial for them
to settle, compromise, and resolve any and all claims asserted or capable of assertion in the Lawsuit.


 


NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby expressly acknowledged, the undersigned
Parties agree as follows:


 


AGREEMENT:


 


1.       Recitals.
The foregoing Recitals are an integral part of this Agreement and are hereby incorporated into this Agreement.


 


2.       All
Liability Denied. This Agreement is a full and final settlement of disputed claims. It shall not be construed as an admission
of liability by any Party to the Agreement. Any Party’s liability to any other Party is expressly denied. Additionally,
any allegation made by any Party against any other Party is expressly denied.


 




    	 



    	 



    

 


3.       Settlement
Payment. Cachet agreed to make the following wire transfers to Trooien according to the following payment schedule, with no
penalty for prepayment:


 


	Due Date	 	Amount	 
	12/13/16	 	$	600,000	 
	12/23/16	 	$	2,500,000	 
	 	 	$	3,100,000	 



 


On
December 13, 2016, the first payment referenced above ($600,000) was transmitted and received by Trooien. The $3,100,000 shall
be referred to as the “Settlement Payment.” The payments shall be made via wire transfer. Trooien shall provide any
necessary documentation in advance of the transfer (i.e. W-9).


 


4.       Issuance
of Warrants. Cachet shall issue 500,000 cashless warrants for stock. The warrants will be priced at $5.55 per share or at
80% of the price of the stock at the time Cachet’s stock is up-listed.


 


5.       Release
of Security Interest. In exchange for the payments identified above and immediately after receipt of the payment identified
in Paragraph 1 and the issuance of warrants in Paragraph 2, Trooien will take all necessary steps to remove, terminate or otherwise
release any and all interest in any tangible or intangible assets of Cachet except insofar as Jerry Trooien or any company he
owns is a shareholder or has an equity interest in Cachet. Among other things, Trooien shall take all necessary steps to remove
or terminate any UCC Financing Statements or similar filings to release or terminate any encumbrance on the assets of Cachet.
Trooien will take all steps described by this Paragraph promptly after receipt of the payments described in Paragraph 3.


 


6.       No
Other Obligations or Payments Owed. Other than the payment provided in this Paragraph 3 and the issuance of warrants described
in Paragraph 4, no additional payments or monies are due or payable by Cachet to Trooien.


 


7.       General
Releases and Covenants Not to Sue.


 


a.       In
consideration for the promises and agreements set forth herein, the Parties, and their affiliates, parents, subsidiaries, and
representatives, hereby release and forever discharge the Parties, and any and all of their related companies, predecessors, successors,
parents, subsidiaries, affiliates, assigns, businesses, divisions, holding companies, partnerships, limited partnerships, partners,
and any of their present and former officers, directors, trustees, conservators, shareholders, partners, owners, principals, employees,
contractors, representatives, attorneys, heirs, devisees, legatees, executors, administrators, insurers, subrogees and agents
(hereinafter collectively “the Releasees”), from any and all claims, demands, actions, liability, damages or rights
of any kind (including, but not limited to, the Lawsuit and claims for attorneys’ fees or costs), whether known or unknown,
arising out of or resulting from any event or circumstance occurring or existing prior to the date of this Agreement. It is understood
and agreed that Jerry Trooien and entities he owns are shareholders and will maintain an equity interest and corresponding rights
as a shareholder in Cachet.


 




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b.
       The Parties do not waive any claims, and maintains the right and power to bring claims
arising out of either Parties’ failure to perform this Agreement pursuant to Paragraphs 3, 4, and 5, above. Failure on the
part of either party to comply with the terms of this Agreement will entitle the other party to injunctive relief. The prevailing
party in any Settlement Agreement enforcement action shall be entitled to attorney fees.


 


8.       Trooien’s
Representations. Trooien represents and agrees that: (a) it received a copy of this Agreement for review and study and has
had sufficient time to consider the Agreement before signing it; (b) it has fully read this Agreement; (c) it has been given a
fair opportunity to discuss and negotiate the terms of this Agreement; (d) it has been advised and encouraged to consult its attorneys,
and it had the opportunity to discuss this Agreement with its attorneys; and (e) it understands and fully agrees to the Agreement's
provisions.


 


9.       Cachet’s
Representations. Cachet represents and agrees that: (a) it received a copy of this Agreement for review and study and has
had sufficient time to consider the Agreement before signing it; (b) it has fully read this Agreement; (c) it has been given a
fair opportunity to discuss and negotiate the terms of this Agreement; (d) it has been advised and encouraged to consult its attorneys
and they had the opportunity to discuss this Agreement with their attorneys; and (e) it understands and fully agrees to the Agreement's
provisions.


 


10.       Severability.
Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable
law or rule, such invalidity, illegality or unenforceability will not affect any other provision of this Agreement, and this Agreement
will be reformed, construed and enforced as if such invalid, illegal, or unenforceable provisions had never been contained herein.


 


11.       Waivers.
A Party’s waiver of a breach of any provision of this Agreement will not operate or be construed as a waiver of any subsequent
breach of the other Party. No failure or delay by any Party in exercising any right or remedy under this Agreement, and no course
of dealing between the Parties, operates as a waiver of such right or remedy, and no single or partial exercise of any such right
or remedy precludes any other or further exercise of such right or remedy or of any other right or remedy.


 


12.       Execution
and Delivery. This Agreement may be executed in counterparts, which taken together shall constitute one agreement binding
on all Parties. Electronically transmitted signatures shall be valid and binding to the same extent as signatures delivered in
original. In making proof of this Agreement, it will be necessary to produce only one copy signed (or reproduced from an electronically
delivered signature) by the party to be charged.


 




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13.       Construction.
The headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed to limit or affect
any of the provisions hereof. The Parties agree that each of them and their respective legal counsel has reviewed and had an opportunity
to revise this Agreement and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved
against the drafting party shall not be employed in the interpretation of this Agreement. Instead, the language used in this Agreement
will be deemed to be the language chosen by the Parties to express their mutual intent.


 


14.       Governing
Law. This Agreement and any other documents referred to herein shall be governed by, construed and enforced in accordance
with the laws of the State of Minnesota. Any dispute arising out of this Agreement shall be heard by a Minnesota court of competent
jurisdiction.


 


15.       Entire
Agreement. This Agreement sets forth the entire agreement reached by the Parties. This Agreement supersedes all prior representations,
statements, proposals, negotiations, discussions, and understandings regarding the same subject matter. This is an integrated
agreement. This Agreement may not be modified or amended except in a writing signed by all of the Parties hereto expressly referencing
this Agreement.


 


16.       Dismissal
With Prejudice. Upon execution of this Agreement, counsel for the Parties shall execute and file a stipulation for dismissal
of the Lawsuit. Within one business day after this Agreement is executed, Plaintiff’s counsel shall notify the Court that
a settlement has been reached and promptly file a stipulation for dismissal and an accompany Proposed Order with the Court. The
Parties agree that each Party shall bear its own costs and attorneys’ fees incurred in connection with the Lawsuit.


 


IN
WITNESS WHEREOF, the Parties have caused this Agreement to be executed as of the first date set forth above.


 


	Dated:
    December 21, 2016	 	 CACHET
    FINANCIAL
	 	 	 	 
	 	 	By:	/s/
    Jeffrey C. Mack
	 	 	 	Jeffrey
    C. Mack
	 	 	 	President
    and Chief Executive Officer
	 	 	 	 
	Dated:
    December 21, 2016	 	Trooien
    Capital
	 	 	 
	 	 	By:	/s/
    Jerry Trooien
	 	 	 	Jerry
    Trooien



 



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NEITHER
THIS WARRANT NOR ANY OF THE SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR UNDER THE SECURITIES LAWS OF ANY OTHER JURISDICTION. BY ACQUIRING THIS WARRANT, HOLDER REPRESENTS THAT HOLDER
WILL NOT SELL OR OTHERWISE DISPOSE OF THIS WARRANT OR THE SECURITIES FOR WHICH IT MAY BE EXERCISED WITHOUT REGISTRATION OR COMPLIANCE
WITH AN EXEMPTION FROM REGISTRATION UNDER THE AFORESAID ACTS AND THE RULES AND REGULATIONS THEREUNDER.


 


WARRANT
TO PURCHASE COMMON STOCK


 


Number
of Shares of Common Stock: 500,000


Date
of Issuance: December 23, 2016 (“Issuance Date”)


 


This
Certifies That, for value received, Trooien Capital
(including any permitted and registered assigns, the “Holder”), is entitled to purchase from Cachet Financial
Solutions, Inc., a Delaware corporation (the “Company”), up to 500,000 shares of Common Stock (the “Warrant
Shares”) at the Exercise Price then in effect. This Warrant to Purchase Common Stock (this “Warrant”)
is issued by the Company pursuant to that certain Settlement Agreement executed prior on the Issuance Date by and among the Company
and Holder (the “Settlement Agreement”).


 


Capitalized
terms used in this Warrant shall have the meanings set forth in the Purchase Agreement unless otherwise defined in the body of
this Warrant or in Section 13 below. For purposes of this Warrant, the term “Exercise Price” shall mean the
lower of (i) $5.55 per share and (ii) 80% of the Company's per share price in the next underwritten public offering (which for
the avoidance of doubt, shall not be adjusted for stock splits, reverse stock splits and recapitalizations occurring before the
next public offering), subject to adjustment as provided herein, and the term “Exercise Period” shall mean
the period commencing on the Issuance Date and ending on 5:00 p.m. New York time on the five-year anniversary thereof.


 


1.       EXERCISE
OF WARRANT.


 


(a)       Mechanics
of Exercise. Subject to the terms and conditions hereof, the rights represented by this Warrant may be exercised in whole
or in part at any time or times during the Exercise Period by delivery of a written notice, in the form attached hereto as Exhibit
A (the “Exercise Notice”), of the Holder’s election to exercise this Warrant. The Holder shall not
be required to deliver the original Warrant in order to effect an exercise hereunder. Execution and delivery of the Exercise Notice
with respect to less than all of the Warrant Shares shall have the same effect as cancellation of the original Warrant and issuance
of a new Warrant evidencing the right to purchase the remaining number of Warrant Shares. On or before the third Trading Day (the
“Warrant Share Delivery Date”) following the date on which the Company shall have received the Exercise Notice,
and upon receipt by the Company of (i) payment to the Company of an amount equal to the applicable Exercise Price multiplied by
the number of Warrant Shares as to which this Warrant is being exercised (the “Aggregate Exercise Price” and
together with the Exercise Notice, the “Exercise Delivery Documents”) in cash or by wire transfer of immediately
available funds or (ii) notification from the Holder that this Warrant is being exercised pursuant to a Cashless Exercise, as
defined below, the Company shall (or direct its transfer agent to) issue and dispatch by overnight courier to the address as specified
in the Exercise Notice, a certificate, registered in the Company’s share register in the name of the Holder or its designee,
for the number of shares of Common Stock to which the Holder is entitled pursuant to such exercise. Upon delivery of the Exercise
Delivery Documents, the Holder shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares
with respect to which this Warrant has been exercised, irrespective of the date of delivery of the certificates evidencing such
Warrant Shares. If this Warrant is submitted in connection with any exercise pursuant to Section 1(c) and the number of Warrant
Shares represented by this Warrant submitted for exercise is greater than the number of Warrant Shares being acquired upon an
exercise, then the Company shall as soon as practicable and in no event later than three Business Days after any exercise and
at its own expense, issue a new Warrant (in accordance with Section 6) representing the right to purchase the number of Warrant
Shares purchasable immediately prior to such exercise under this Warrant, less the number of Warrant Shares with respect to which
this Warrant is exercised.


 




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(b)       No
Fractional Shares. No fractional shares shall be issued upon the exercise of this Warrant as a consequence of any adjustment
pursuant hereto. All Warrant Shares (including fractions) issuable upon exercise of this Warrant may be aggregated for purposes
of determining whether the exercise would result in the issuance of any fractional share. If, after aggregation, the exercise
would result in the issuance of a fractional share, the Company shall, in lieu of issuance of any fractional share, pay the Holder
otherwise entitled to such fraction a sum in cash equal to the product resulting from multiplying the then-current fair market
value of a Warrant Share by such fraction.


 


(c)       Cashless
Exercise. The Holder may, in its sole discretion, at any time prior to the effective date of a registration statement filed
by the Company or any Subsidiary under the Securities Act covering the Warrant Shares, exercise this Warrant in whole or in part
and, in lieu of making the cash payment otherwise contemplated to be made to the Company upon such exercise in payment of the
Aggregate Exercise Price, elect instead to receive upon such exercise the “Net Number” of shares of Common
Stock determined according to the following formula (a “Cashless Exercise”):


 


Net
Number = (A x B) - (A x C)


        B


 


For
purposes of the foregoing formula:


 


		A
                             =	the
                                         total number of shares with respect to which this Warrant is then being exercised.



 


		B
                             =	the
                                         Weighted Average Price of the shares of Common Stock for the five consecutive Trading
                                         Days ending on the date immediately preceding the date of the Exercise Notice.



 


		C
                             =	the
                                         Exercise Price then in effect for the applicable Warrant Shares at the time of such exercise.



 


(d)       Holder’s
Exercise Limitations. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to
exercise any portion of this Warrant, to the extent that after giving effect to issuance of Warrant Shares upon exercise as set
forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other persons acting
as a group together with the Holder or any of the Holder’s Affiliates), would beneficially own in excess of the Beneficial
Ownership Limitation, as defined below. For purposes of the foregoing sentence, the number of shares of Common Stock beneficially
owned by the Holder and its Affiliates shall include the number of shares of Common Stock issuable upon exercise of this Warrant
with respect to which such determination is being made, but shall exclude the number of shares of Common Stock which would be
issuable upon (i) exercise of the remaining, non-exercised portion of this Warrant beneficially owned by the Holder or any of
its Affiliates and (ii) exercise or conversion of the unexercised or non-converted portion of any other securities of the Company
(including without limitation any other Common Stock Equivalents) subject to a limitation on conversion or exercise analogous
to the limitation contained herein beneficially owned by the Holder or any of its Affiliates. Except as set forth in the preceding
sentence, for purposes of this paragraph (d), beneficial ownership shall be calculated in accordance with Section 13(d) of the
Exchange Act, it being acknowledged by the Holder that the Company is not representing to the Holder that such calculation is
in compliance with Section 13(d) of the Securites Exchange Act of 1934, as amended, and the Holder is solely responsible for any
schedules required to be filed in accordance therewith. To the extent that the limitation contained in this paragraph applies,
the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any
affiliates) and of which portion of this Warrant is exercisable shall be in the sole discretion of the Holder, and the submission
of a Notice of Exercise shall be deemed to be the Holder’s determination of whether this Warrant is exercisable (in relation
to other securities owned by the Holder together with any Affiliates) and of which portion of this Warrant is exercisable, in
each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation to verify or confirm the accuracy
of such determination.


 


For
purposes of this paragraph, in determining the number of outstanding shares of Common Stock, a Holder may rely on the number of
outstanding shares of Common Stock as reflected in (A) the Company’s most recent periodic or annual report filed with the
Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice by the
Company or its transfer agent setting forth the number of shares of Common Stock outstanding. Upon the request of a Holder, the
Company shall within two Trading Days confirm to the Holder the number of shares of Common Stock then outstanding. In any case,
the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities
of the Company, including this Warrant, by the Holder or its affiliates since the date as of which such number of outstanding
shares of Common Stock was reported. The “Beneficial Ownership Limitation” shall be 4.99% of the number of
shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock issuable upon
exercise of this Warrant. Upon no fewer than 61 days’ prior notice to the Company, a Holder may increase or decrease the
Beneficial Ownership Limitation provisions of this paragraph, provided that the Beneficial Ownership Limitation in no event exceeds
9.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common
Stock upon exercise of this Warrant held by the Holder and the provisions of this paragraph shall continue to apply. Any such
increase or decrease will not be effective until the 61st day after such notice is delivered to the Company and shall only apply
to such Holder and no other Holder. The limitations contained in this paragraph shall apply to a successor Holder of this Warrant.


 




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2.       ADJUSTMENTS.
The Exercise Price and the number of Warrant Shares shall be adjusted from time to time as follows:


 


(a)       Subdivision
or Combination of Common Stock. If the Company at any time on or after the Issuance Date subdivides (by any stock split, stock
dividend, recapitalization or otherwise) one or more classes of its outstanding shares of Common Stock into a greater number of
shares, the Exercise Price in effect immediately prior to such subdivision will be proportionately reduced and the number of Warrant
Shares will be proportionately increased. If the Company at any time on or after the Issuance Date combines (by combination, reverse
stock split or otherwise) one or more classes of its outstanding shares of Common Stock into a smaller number of shares, the Exercise
Price in effect immediately prior to such combination will be proportionately increased and the number of Warrant Shares will
be proportionately decreased. Any adjustment under this Section shall become effective at the close of business on the date the
subdivision or combination becomes effective.


 


(b)       Distribution
of Assets. If the Company shall declare or make any dividend or other distribution of its assets (or rights to acquire its
assets) to holders of shares of Common Stock, by way of return of capital or otherwise (including without limitation any distribution
of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement
or other similar transaction) (a “Distribution”), at any time after the issuance of this Warrant, then, in
each such case:


 


(i)       any
Exercise Price in effect immediately prior to the close of business on the record date fixed for the determination of holders
of shares of Common Stock entitled to receive the Distribution shall be reduced, effective as of the close of business on such
record date, to a price determined by multiplying such Exercise Price by a fraction (i) the numerator of which shall be the Closing
Sale Price of the shares of Common Stock on the Trading Day immediately preceding such record date minus the value of the Distribution
(as determined in good faith by the Company’s Board of Directors) applicable to one share of Common Stock, and (ii) the
denominator of which shall be the Closing Sale Price of the shares of Common Stock on the Trading Day immediately preceding such
record date; and


 


(ii)       the
number of Warrant Shares shall be increased to a number of shares equal to the number of shares of Common Stock obtainable immediately
prior to the close of business on the record date fixed for the determination of holders of shares of Common Stock entitled to
receive the Distribution multiplied by the reciprocal of the fraction set forth in the immediately preceding clause (i); provided,
however, that in the event that the Distribution is of shares of common stock of a company (other than the Company) whose common
stock is traded on a national securities exchange or a national automated quotation system (“Other Shares of Common Stock”),
then the Holder may elect to receive a warrant to purchase Other Shares of Common Stock in lieu of an increase in the number of
Warrant Shares, the terms of which shall be identical to those of this Warrant, except that such warrant shall be exercisable
into the number of shares of Other Shares of Common Stock that would have been payable to the Holder pursuant to the Distribution
had the Holder exercised this Warrant immediately prior to such record date and with an aggregate exercise price equal to the
product of the amount by which the exercise price of this Warrant was decreased with respect to the Distribution pursuant to the
terms of the immediately preceding clause (i) and the number of Warrant Shares calculated in accordance with the first part of
this clause (ii).


 


3.       FUNDAMENTAL
TRANSACTIONS. If, at any time while this Warrant is outstanding, (i) the Company effects any merger of the Company with or
into another entity and the Company is not the surviving entity (such surviving entity, the “Successor Entity”),
(ii) the Company effects any sale of all or substantially all of its assets in one or a series of related transactions, (iii)
any tender offer or exchange offer (whether by the Company or by another individual or entity, and approved by the Company) is
completed pursuant to which holders of Common Stock are permitted to tender or exchange their shares of Common Stock for other
securities, cash or property and the holders of at least 50% of the Common Stock accept such offer, or (iv) the Company effects
any reclassification of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted
into or exchanged for other securities, cash or property (other than as a result of a subdivision or combination of shares of
Common Stock covered by Section 2(a) above) (in any such case, a “Fundamental Transaction”), then, upon any
subsequent exercise of this Warrant, the Holder shall have the right to receive the number of shares of Common Stock of the Successor
Entity or of the Company and any additional consideration (the “Alternate Consideration”) receivable upon or
as a result of such reorganization, reclassification, merger, consolidation or disposition of assets by a holder of the number
of shares of Common Stock for which this Warrant is exercisable immediately prior to such event (disregarding any limitation on
exercise contained herein solely for the purpose of such determination). For purposes of any such exercise, the determination
of the Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate
Consideration issuable in respect of one share of Common Stock in such Fundamental Transaction, and the Company shall apportion
the Exercise Price among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components
of the Alternate Consideration. If holders of Common Stock are given any choice as to the securities, cash or property to be received
in a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives upon
any exercise of this Warrant following such Fundamental Transaction. To the extent necessary to effectuate the foregoing provisions,
any Successor Entity in such Fundamental Transaction shall issue to the Holder a new warrant consistent with the foregoing provisions
and evidencing the Holder’s right to exercise such warrant into Alternate Consideration.


 




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4.       NON-CIRCUMVENTION.
The Company covenants and agrees that it will not, by amendment of its certificate of incorporation, bylaws or through any reorganization,
transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary
action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, and will at all times in good
faith carry out all the provisions of this Warrant and take all action as may be required to protect the rights of the Holder.
Without limiting the generality of the foregoing, the Company (i) shall not increase the par value of any shares of Common Stock
receivable upon the exercise of this Warrant above the Exercise Price then in effect, (ii) shall take all such actions as may
be necessary or appropriate in order that the Company may validly and legally issue fully paid and non-assessable shares of Common
Stock upon the exercise of this Warrant, and (iii) shall, for so long as this Warrant is outstanding, have authorized and reserved,
free from preemptive rights, a sufficient number of shares of Common Stock to provide for the exercise of the rights represented
by this Warrant (without regard to any limitations on exercise).


 


5.       WARRANT
HOLDER NOT DEEMED A STOCKHOLDER. Except as otherwise specifically provided herein, this Warrant, in and of itself, shall not
entitle the Holder to any voting rights or other rights as a stockholder of the Company. In addition, nothing contained in this
Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities (upon exercise of this Warrant
or otherwise) or as a stockholder of the Company, whether such liabilities are asserted by the Company or by creditors of the
Company.


 


6.       REISSUANCE.


 


(a)       Lost,
Stolen or Mutilated Warrant. If this Warrant is lost, stolen, mutilated or destroyed, the Company will, on such terms as to
indemnity or otherwise as it may reasonably impose (which shall, in the case of a mutilated Warrant, include the surrender thereof),
issue a new Warrant of like denomination and tenor as this Warrant so lost, stolen, mutilated or destroyed.


 


(b)       Issuance
of New Warrants. Whenever the Company is required to issue a new Warrant pursuant to the terms of this Warrant, such new Warrant
shall be of like tenor with this Warrant, and shall have an issuance date, as indicated on the face of such new Warrant which
is the same as the Issuance Date.


 


7.       TRANSFER.


 


(a)       Notice
of Transfer. The Holder agrees to give written notice to the Company before transferring this Warrant or transferring any
Warrant Shares of such Holder’s intention to do so, describing briefly the manner of any proposed transfer. Promptly upon
receiving such written notice, the Company shall present copies thereof to the Company’s counsel. If the proposed transfer
may be effected without registration or qualification (under any federal or state securities laws), the Company, as promptly as
practicable, shall notify the Holder thereof, whereupon the Holder shall be entitled to transfer this Warrant or to dispose of
Warrant Shares received upon the previous exercise of this Warrant, all in accordance with the terms of the notice delivered by
the Holder to the Company; provided, however, that an appropriate legend may be endorsed on this Warrant or the certificates for
such Warrant Shares respecting restrictions upon transfer thereof necessary or advisable in the opinion of counsel and satisfactory
to the Company to prevent further transfers which would be in violation of Section 5 of the Securities Act and applicable state
securities laws; and provided further that the prospective transferee or purchaser shall execute the Assignment of Warrant attached
hereto as Exhibit B and such other documents and make such representations, warranties, and agreements as may be required
solely to comply with the exemptions relied upon by the Company for the transfer or disposition of the Warrant or Warrant Shares.


 




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(b)       If
the proposed transfer or disposition of this Warrant or such Warrant Shares described in the written notice given pursuant to
this Section 7 may not be effected without registration or qualification of this Warrant or such Warrant Shares, the Holder will
limit its activities in respect to such transfer or disposition as are permitted by law.


 


(c)       Any
transferee of all or a portion of this Warrant shall succeed to the rights and benefits of the initial Holder of this Warrant
under Sections 4.1 and 4.3 (subject, however, to the limitations set forth in Section 4.2), 4.4 and 4.5 of the Purchase Agreement
(registration rights, expenses, and indemnity).


 


8.       NOTICES.
Whenever notice is required to be given under this Warrant, unless otherwise provided herein, such notice shall be given in accordance
with the notice provisions contained in the Purchase Agreement. The Company shall provide the Holder with prompt written notice
(i) immediately upon any adjustment of the Exercise Price, setting forth in reasonable detail, the calculation of such adjustment
and (ii) at least 20 days prior to the date on which the Company closes its books or takes a record (A) with respect to any dividend
or distribution upon the shares of Common Stock, (B) with respect to any grants, issuances or sales of any stock or other securities
directly or indirectly convertible into or exercisable or exchangeable for shares of Common Stock or other property, pro rata
to the holders of shares of Common Stock or (C) for determining rights to vote with respect to any Fundamental Transaction, dissolution
or liquidation, provided in each case that such information shall be made known to the public prior to or in conjunction with
such notice being provided to the Holder.


 


9.       AMENDMENT
AND WAIVER. The terms of this Warrant may be amended or waived (either generally or in a particular instance and either retroactively
or prospectively) only with the written consent of the Company and the Holder. In addition, the restrictions set forth in Section
1(d) can be waived, as to a particular original purchaser of Common Stock and its affiliates, pursuant to a writing signed and
delivered by the Company and such original Purchaser prior to the execution and delivery of this Warrant.


 


10.       GOVERNING
LAW. This Warrant and all rights, obligations and liabilities hereunder shall be governed by, and construed in accordance
with, the internal laws of the State of Minnesota, without giving effect to the conflicts-of-law principles thereof.


 


11.       DISPUTE
RESOLUTION. A dispute as to the determination of the Exercise Price, the Closing Sale Price, or the arithmetic calculation
of the Warrant Shares, the Company or the Holder (as the case may be) shall submit the disputed determinations or arithmetic calculations
via facsimile (a) within two Business Days after receipt of the applicable notice giving rise to such dispute to the Company or
the Holder, as the case may be, or (b) if no notice gave rise to such dispute, at any time after the Holder learned of the circumstances
giving rise to such dispute. If the Holder and the Company are unable to agree upon such determination or calculation of the Exercise
Price, Closing Sale Price or the Warrant Shares within three Business Days of such disputed determination or arithmetic calculation
being submitted to the Company or the Holder, as the case may be, then the Company shall, within two Business Days thereafter
submit via facsimile (x) the disputed determination of the Exercise Price or Closing Sale Price to an independent, reputable investment
bank selected by the Company and approved by the Holder or (y) the disputed arithmetic calculation of the Warrant Shares to the
Company’s independent, outside accountant. The Company shall cause at its expense the investment bank or the accountant,
as the case may be, to perform the determinations or calculations and notify the Company and the Holder of the results no later
than ten Business Days from the time it receives the disputed determinations or calculations. Such investment bank’s or
accountant’s determination or calculation, as the case may be, shall be binding upon all parties absent manifest error.


 


12.       ACCEPTANCE.
Receipt of this Warrant by the Holder shall constitute acceptance of and agreement to all of the terms and conditions contained
herein.


 


13.       CERTAIN
DEFINITIONS. For purposes of this Warrant, the following terms shall have the following meanings:


 


(a)       “Bloomberg”
means Bloomberg Financial Markets.


 




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(b)       “Closing
Sale Price” means, for any security as of any date, (i) the last closing trade price for such security on the Principal
Market, as reported by Bloomberg, or, if the Principal Market begins to operate on an extended hours basis and does not designate
the closing trade price, then the last trade price of such security prior to 4:00 p.m., New York time, as reported by Bloomberg,
or (ii) if the foregoing does not apply, the last trade price of such security in the over-the-counter market for such security
as reported by Bloomberg, or (iii) if no last trade price is reported for such security by Bloomberg, the average of the bid and
ask prices of any market makers for such security as reported by the OTC Markets. If the Closing Sale Price cannot be calculated
for a security on a particular date on any of the foregoing bases, the Closing Sale Price of such security on such date shall
be the fair market value as mutually determined by the Company and the Holder. All such determinations to be appropriately adjusted
for any stock dividend, stock split, stock combination or other similar transaction during the applicable calculation period.


 


(c)       “Common
Stock” means the Company common stock, par value $0.0001 per share, and any other class of securities into which such
securities may hereafter be reclassified or changed.


 


(d)       “Common
Stock Equivalents” means any securities of the Company that would entitle the holder thereof to acquire at any time
Common Stock, including without limitation any debt, preferred stock, rights, options, warrants or other instrument that is at
any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock.


 


(e)       “Principal
Market” means the primary national securities exchange on which the Common Stock is then traded.


 


(f)       “Trading
Day” means (i) any day on which the Common Stock is listed or quoted and traded on its Principal Market, (ii) if the
Common Stock is not then listed or quoted and traded on any national securities exchange, then a day on which trading occurs on
any over-the-counter markets, or (iii) if trading does not occur on the over-the-counter markets, any Business Day.


 


*
* * * * * *


 




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In
Witness Whereof, the Company has caused this
Warrant to Purchase Common Stock to be duly executed as of the Issuance Date set forth above.


 


	 	CACHET
    FINANCIAL SOLUTIONS, INC.
	 	 
	 	/s/
    Bryan Meier
	 	Bryan
    Meier
	 	Executive
    Vice President & Chief Financial Officer


 




    	 



    	 



    

 


EXHIBIT
A


 


EXERCISE
NOTICE


 


(To
be executed by the registered holder to exercise this Warrant to Purchase Common Stock)


 


The
Undersigned holder hereby exercises the right
to purchase _________________ of the shares of Common Stock (“Warrant Shares”) of Cachet Financial Solutions, Inc.,
a Delaware corporation (the “Company”), evidenced by the attached copy of the Warrant to Purchase Common Stock (the
“Warrant”). Capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in
the Warrant.


 


	1.	Form
    of Exercise Price. The Holder intends that payment of the Exercise Price shall be made as (check one):


 


	 	[  ]	a
    cash exercise with respect to _________________ Warrant Shares; and/or
	 	 	 
	 	[  ]	a
    “Cashless Exercise” with respect to _______________ Warrant Shares.


 


	2.	Payment
    of Exercise Price. In the event that the holder has elected a cash exercise with respect to some or all of the Warrant
    Shares to be issued pursuant hereto, the holder shall pay the Aggregate Exercise Price in the sum of $___________________
    to the Company in accordance with the terms of the Warrant.


 


	3.	Delivery
    of Warrant Shares. The Company shall deliver to the holder __________________ Warrant Shares in accordance with the terms
    of the Warrant.


 


	Date:	 	 


 


	 	 	 
	 	(Print Name of Registered Holder)
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 



 



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EXHIBIT
B


 


ASSIGNMENT
OF WARRANT


 


(To
be signed only upon authorized transfer of the Warrant)


 


For
Value Received, the undersigned hereby sells,
assigns, and transfers unto ____________________ the right to purchase _______________ shares of common stock of Cachet Financial
Solutions, Inc., to which the within Warrant to Purchase Common Stock relates and appoints ____________________, as attorney-in-fact,
to transfer said right on the books of Cachet Financial Solutions, Inc. with full power of substitution and re-substitution in
the premises. By accepting such transfer, the transferee has agreed to be bound in all respects by the terms and conditions of
the within Warrant.


 


	Dated:
    __________________	 	 
	 	 	 
	 	 	 
	 	 	(Signature)
    *
	 	 	 
	 	 	 
	 	 	(Name)
	 	 	 
	 	 	 
	 	 	(Address)
	 	 	 
	 	 	 
	 	 	(Social
    Security or Tax Identification No.)


 


*
The signature on this Assignment of Warrant must correspond to the name as written upon the face of the Warrant to Purchase Common
Stock in every particular without alteration or enlargement or any change whatsoever. When signing on behalf of a corporation,
partnership, trust or other entity, please indicate your position(s) and title(s) with such entity.


 




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